Tripoint Global Equities LLC a securities broker dealer headquartered in New York New York has been censured by Financial industry Regulatory Authority (FINRA) according to an Order Accepting Offer of Settlement issued by FINRA Office of Hearing Officers who found that Tripoint and its CEO Mark Elenowitz made unsuitable investment recommendations to customers in regards to private placements. Department of Enforcement v. Tripoint Global Equities LLC Disciplinary Proceeding No. 2017053409201 (Sept. 24, 2020).

According to the Order, between November of 2015 and August of 2016, Tripoint and Elenowitz advised customers to invest in four private placement offerings when Tripoint lacked an adequate foundation to conclude that those recommendations were suitable for investors. The Hearing Panel found that there was no adequate due diligence conducted by Tripoint and Elenowitz as it related to these offerings.

The Order indicated that Issuer A and Issuer B purported to be in the business of purchasing and selling tickets to theater and live concert events. FINRA indicated that Issuer A and Issuer B were created by Principal 1 and Principal 2 and both of those principals managed the issuers.

The Order stated that there was no adequate investigation undertaken by Tripoint and Elenowitz in regard to the issuers’ red flags. Tripoint and Elenowitz did not appropriately investigate the business prospects of Issuer A and Issuer B and did not appropriately investigate the control and management relating to the ticketing resale business.

FINRA stated that $500,000.00 in placement agent fees had been received by Tripoint in reference to its $16,000,000.00 in sales to 42 of the securities broker dealer’s customers. Millions in losses have been sustained by investors who purchased those offerings through Tripoint. The investments made by some of Tripoint’s customers had been subject to a Ponzi scheme that was operated by Principal 1 and Principal 2. The Hearing Officer determined that Tripoint’s conduct was violative of FINRA Rules 2010 and 2111.

The Order also started that Tripoint’s written supervisory procedures were not complied with. Tripoint and Elenowitz did not confirm that the written supervisory procedures were enforced as it pertained to due diligence and investigations of the issuers of private placements. Tripoint’s conduct was violative of FINRA Rules 2010 and 3110(a) and (b) in this respect.

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